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Ranhill expands Water Projects in SE Asia

Ranhill Holdings Bhd is bullish on expanding its water business in Southeast Asia via China-based strategic partner SIIC Environment Holdings Ltd’s investments in the region under the One Belt, One Road (Obor) initiative.

President and chief executive officer Tan Sri Hamdan Mohamad said the group is currently eyeing further expansion in Malaysia and Thailand, and may consider Indonesia and Vietnam in the future.

“There are many opportunities in Malaysia, as well as the east of Thailand,” he told reporters after the water management and power generation group’s annual general meeting yesterday. Ranhill is present in Thailand under the Ranhill Water Technologies (Thai) Ltd.

Ranhill announced in September 2016 it will divest a 60% stake in its indirect unit Ranhill Water (Hong Kong) Ltd to the Singapore Exchange-listed SIIC for 273.9 million yuan (RM170 million).

Hamdan said SIIC, a top-tier integrated player in China’s environmental industry, is keen on investments outside of China under the Obor initiative.

“[Our partnership with SIIC] gives us access to better investments and water concessions in Southeast Asia, including Malaysia. We are quite bullish on expansion in the region [through their investments] under the Obor initiative.

“There is still underdevelopment and underspending in Malaysia’s water and sewage industry development, for example in Sabah and Sarawak,” he said, adding that the group’s partnership with SIIC will open up new investment avenues, through the procurement of wastewater concessions.

Currently, the group has 11 long-term wastewater concessions in China, with an aggregate capacity of 260 million litres per day (MLD) and concession periods between 25 years and 30 years.

Hamdan also said Ranhill plans to reduce non-revenue water (NRW) from pipe leakages in Johor from the current 25.9% to 24.8% by year end. “We also aim to reduce the NRW specifically in Johor Baru from the current 20% to 15% over three years.”

Ranhill, through its wholly-owned subsidiary Ranhill Water Services Sdn Bhd (RWS), is involved in NRW management and reduction in Malaysia. The energy, green technology and water ministry had issued an exclusive licence for it to provide source-to-tap water supply services with a total capacity of 1,986 MLD to end-customers in Johor.

Meanwhile, Ranhill also plans to increase its power generation capacity from the current 380 megawatts (mw) to 1,000mw by 2020, by boosting its supply of renewable energy using solar, wind and geothermal technologies and through possible acquisitions of power plants.

The group currently has two combined 190mw cycle gas turbine power plants in Kota Kinabalu. It had also been awarded a 300mw plant in Sandakan by the energy commission. Ranhill shares closed half a sen lower at 87 sen yesterday, with a market capitalisation of RM763.95 million.

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